A contradiction in Hayek’s famous 1945 article

In his “Quote of the Day” yesterday, one of my favorite parts of CafeHayek, Don Boudreaux quotes from one of my favorite articles by Hayek, his “The Use of Knowledge in Society,” published in American Economic Review in 1945. (Note in brackets: Wouldn’t it be great if the AER started publishing articles with words and without equations, articles that made important points? One can dream.)

Here is an important paragraph that Don quotes:

The special character of the problem of a rational economic order is determined precisely by the fact that the knowledge of circumstances which we must use never exists in a concentrated or integrated form, but only in the form of scattered bits of incomplete and often contradictory knowledge possessed by all separate individuals. The economic problem of society is therefore not just a problem of allocating “given” resources – if “given” is understood as given to a single mind which consciously solves the problem posed by these “data”. It is rather a problem of ensuring the best possible use of resources known to any member of society for purposes whose relative importance is known only to those individuals. Or, to put it briefly, it is a problem of using knowledge which is not given to anyone in its entirety.

For the past 20 years that I have taught at the Naval Postgraduate School, I have always assigned this article as an assignment and we have worked through it paragraph by paragraph in class. (In the past, Liberty Fund had numbered each paragraph, which made class discussion easier.)

But you can’t teach an article over and over again without noticing problems. In fact, I only noticed one thing about this article, and that was in the paragraph above.

It is “often contradictory knowledge”.

To know tilt be contradictory. Opinions can be. Assessments can be. But not knowledge.

Let me give you an example. I’m at my cabin in Minaki, Ontario. One of the biggest changes since last year is that the landfill has been closed. Bears used to go there to feast on people’s leftovers. Now they don’t do that anymore. So the bears are coming closer to the cabins now.

Let’s say I know there’s a bear in my yard. You know there isn’t one. If I really know, then you’re wrong.

Or vice versa. You know there is no bear in my yard. I “know” there isn’t one. If you really know, then I’m wrong.

What’s up?